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Do You Understand the Email Halo Effect?

Many companies struggle with measuring the impact of email on their organizations. As a result, email is becoming an undervalued tool in most marketers' arsenals.

One of the most effective ways that marketers can showcase the true benefits of a strategic email marketing campaign is by measuring and presenting the effects of an email, even when there was no open or click. This is called the halo effect.

First, however, it's important to understand the most common attribution models (that figure how sales and conversion are determined) email marketers are using. Typically, the model is a combination of the following three factors:

Types of action—Will you focus on emails sent, opened, or clicked through?

Time frame—Are you measuring actions within days, weeks, or months from the action

Order of touch—What's the order of touch, such as interacting with the first email sent, last touch, or any interaction at all?

Most email marketers will choose the combination that works best for their business, typically in relation to its sales cycle, but the popular approach is to focus on tracking conversions via click.

What Does a Click Tell You?

The truth is a click doesn't necessarily tell a marketer anything.

Not everyone who clicks through from an email will go to the website and make a purchase. A click also doesn't account for the likelihood the receiver might be prompted by the email to purchase something from another channel at a later date.

Evidence from the UK DMA's 2013 Consumer Tracking report showed that 23% of respondents mentioned "visiting the company’s website via another route" as a likely response to an interesting email. A quarter (25%) said a likely response would be "visiting a shop or retail outlet."

Clearly, there is value from sending an email that is not being collected when you just focus on click-throughs. So, how can we measure that?

My initial advice is to run an analysis of revenue from all channels except email as a starting point. Then take that revenue from a given period of time, and deduct the email-specific revenue (determined from opens and clicks) and break down the new number by days when emails were and weren't sent out.

We recently did this with a client based on its revenue for one month. The results showed the average daily revenue on days in which email was sent delivered higher revenue through non-email channels. We then looked at the source of the revenue based on last touch and first touch. Email had the biggest effect where no channels had been identified (i.e., clearly not from affiliate sites, referring domains, etc.)

So, what does this all mean?

Our main conclusion was that email is certainly driving sales in other channels, and this is one way to prove it.

I must admittedly caution marketers from defining email and the halo effect too broadly and overstating the revenue generated by email or defining it too narrowly and underestimating.

However, if marketers can find the right balance and look at email as part of the bigger picture, they'll quickly see that it can work in capacity similar to broadcast email and greatly support other channels.

That brings us back to the importance of attribution models. If email is driving offline responses, then marketers need to consider that fact before they decide on which model they will use for a campaign.

If marketers look beyond simple click-based attribution and track and analyze both online and offline traffic and conversions, marketers will find that demonstrating the value of an email marketing campaign becomes much easier.

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Dela Quist is CEO of Alchemy Worx, digital marketing agency dedicatedsolely to email. With offices in Atlanta and London, Alchemy Worx has a diverse client portfolio that includes Getty Images, Hilton, and Sony Playstation.